Complaint submitted to EnC against North Macedonia over small hydropower plants

Environmental groups Eko-Svest and CEE Bankwatch Network have filed a complaint to the Energy Community (EnC) Secretariat over North Macedonia’s redesigned renewable energy incentives scheme which they say is unfairly favoring small hydropower plants (SHPPs).

As of February, North Macedonia’s renewable energy incentives system subjects solar photovoltaic (PV) producers and most wind producers, but not small hydropower plants, to auctions, designed to minimize costs for consumers, with winning bidders being those that seek the lowest premiums to be paid on top of the market price of electricity they generate.

North Macedonia is a Contracting Party of the Energy Community, whose Treaty prohibits “any public aid which distorts or threatens to distort competition by favouring certain undertakings or certain energy resources,” the environmental groups recalled in a press release.

They also recalled that small hydropower plants have in recent years wrought destruction across Southeast Europe – including North Macedonia – due to their rapid development, often in protected areas, and lack of environmental law enforcement.

Small hydropower plants under 10 MW are not only not subject to auctions for premiums, they continue receiving subsidies in the form of feed-in tariffs and there is also no cap for feed-in tariffs for small hydropower plants, the environmental groups noted.

At the same time, solar photovoltaics cannot receive any feed-in tariffs, no matter the size. All quotas for wind plants have already been reserved, and only a few megawatts of biomass and biogas can still receive operating support, the press release reads.

Under the Decision on the total installed capacity of preferential electricity producers, the total installed capacity of preferential electricity producers is prescribed. The caps for capacities that receive feed-in tariffs are the following:

• 86 MW for wind power plants – but this is all reserved for the existing Bogdanci plant, the extension of the project, and the planned Bogoslovec plant.
• 10 MW for thermal power plants on biomass, of which 4.3 MW is already reserved.
• 20 MW for thermal power plants on biogas, of which 7 MW is already reserved.
• No cap for feed-in tariffs for small hydropower plants.

The cap for photovoltaic power plants that receive premiums is 200 MW, while there is no cap for wind premiums other than the one set by individual auctions. There is no support for solar photovoltaic plants which are too small to compete in auctions at all, the environmental groups noted.

Deputy PM’s small hydropower business raises eyebrows

“The Deputy Prime Minister of North Macedonia, Kocho Angjushev, owns a large number of small hydropower plants, and his cabinet is closely involved in the preparation of energy sector legislation. So the Government’s decision to give preferential subsidies to small hydropower looks suspicious,” said Davor Pehchevski of Eko-Svest.

Through the umbrella company Fero Invest, Deputy Prime Minister Kocho Angjushev owns at least 25 small hydropower plants (SHPP), a company for design of SHPPs, a company for production and installation of turbines and a company for SHPP maintenance, the press release reads, also providing a link containing evidence of Angjushev’s majority ownership.